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Costs of health care reform

Just days after President Obama signed the historic legislation aimed at increasing coverage for the millions Americans without health insurance, companies are racing to warn shareholders of the increased expenses.  No word on the costs local Kansas City companies like Sprint, Hallmark and Cerner but we can expect  to hear more in the coming weeks.

* John Deere – $150 Million
* Caterpillar – $100 Million
* AK Steel – $31 Million
* 3M – $90 Million
* AT&T – $1 Billion

As the days and weeks drag on, we can expect to see more announcements from large companies around the country. Although changes to benefits will not be immediate, it is only reasonable to assume that many will be looking for ways to reduce costs and/or pass these additional expenses onto employees. Verizon sent a letter to employees stating that changes in the law could have an impact on both retires and current employees.

Now it appears that some Democratic lawmakers are challenging the claims made by these companies. I guess that these public announcements don’t play into the game plan of convincing the American people that the new law is designed to expand coverage and bring down costs. Executives from Verizon, Caterpillar and John Deere have been asked to provide documentation to congressional committees by April 9th. Boeing and MetLife have also expressed concern that the changes could result in the coverage reductions and retirees shifting to Medicare Part D.

Comments

  • BizCommentaryExaminer 4 years ago

    Nice story on all counts. Great info!

    Subscribing to you.

  • Denise 4 years ago

    It's a good thing we have health care reform, because it's making me sick.

  • Dylan 4 years ago

    Of course companies are mad about the govt. taking away the free money (tax breaks) they were receiving on their free money (subsidies). It was crazy that this loophole was there to begin with. Let's say a company spent $100 for a retiree for prescription drug coverage. The govt gives them $28 which won't change under the new rules as a subsidy to provide this benefit. Then, the company can turn around and deduct all $100 on their taxes even though that wasn't all their money. It is taxpayer money. Now companies will only be able to deduct the correct 72% of the actual amount they are paying. They still get the 28% though, we just never should have been giving them the extra tax break to begin with.

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